Nikkei edges up in choppy trade; weak yen supports exporters

  • Reuters
  • Stock Market News
Nikkei edges up in choppy trade; weak yen supports exporters
Credit: © Reuters.

* Tokyo Electron, TDK rise

* Defensive stocks underperform

By Ayai Tomisawa

TOKYO, June 11 (Reuters) - Japan's Nikkei ended higher in choppy trade on Tuesday as cyclical stocks, inclding exporters, gained on the back of a weaker yen, while defensive firms underperformed.

The Nikkei share average .N225 rose 0.3% to 21,204.28, after gaining 1.2% on Monday.

On Monday, Japanese stocks recovered above the 21,000 level and hit a two-week high, with buyers encouraged by hopes for a U.S. interest rate cut and relief over U.S. President Donald Trump withdrawal of a tariff threat against Mexico.

Strategists said investors were awaiting more cues on U.S. monetary policy from the Federal Reserve's June 18-19 policy meeting as well as developments in the U.S.-China trade war ahead of the G20 summit later this month.

Trump said on Monday he was ready to impose another round of punitive tariffs on Chinese imports if he cannot make progress in talks with Chinese President Xi Jinping at the G20 summit. stocks need more catalysts to rise further, but the Nikkei's downside should be supported as it has recovered its 25-day moving average (of 21,072.19)," said Takuya Takahashi, a strategist at Daiwa Securities.

Financials were supported by higher U.S. yields, with Mitsubishi UFJ Financial Group 8306.T rising 1.5% and Sumitomo Mitsui Financial Group 8316.T adding 1.2%.

Exporters were also up after the dollar advanced 0.2% to 108.65 yen.

Tokyo Electron 8035.T gained 2.4%, TDK Corp 6762.T rose 1.8% and Yaskawa Electric Corp 6506.T surged 3.4%.

Renesas Electronics 6723.T soared 4.4% after the company said it established the 'Automotive Electronic Joint Laboratory' with SAIC Volkswagen (DE: VOWG_p ) Automobile Co.

Other cyclical stocks were also in demand, with sea transport and steel makers attracting buyers. Mitsui OSK Lines 9104.T surged 1.5% and Nippon Steel Corp 5401.T rose 1.1%.

MonotaRO 3064.T , which provides factory materials through mail order, jumped 7.4% after its May sales surged 22.6% on the year.

Defensive stocks such as railroad shares and drugmakers underperformed. East Japan Railway 9020.T dropped 0.8% and Astellas Pharma 4503.T slipped 1.2%.

The broader Topix .TOPX gained 0.5% to 1,561.32.

(Editing by Shri Navaratnam)

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